What is PPN 026? The new Social Value Model

PPN 026 is the Cabinet Office Procurement Policy Note that rewrites how central government scores social value. It was published on 5 August 2026 and applies to procurements where the tender notice is published on or after 1 January 2027. If you sell to a government department, an executive agency or a non-departmental public body and your contracts are worth £1m or more, it decides between 10% and 20% of your score.

We have read the PPN line by line, checked it against the Procurement Act 2023 and compared it with every explainer published since 5 August 2026. This is what we know as at 9 September 2026 and what is still to come in the guidance due in autumn 2026.

Timeline from the Public Services (Social Value) Act 2012 through PPN 06/20, PPN 002 and the Procurement Act 2023 to PPN 026 applying on 1 January 2027

What PPN 026 is and what it replaces

The PPN defines social value for central government contracts as "taking account of how a supplier will work for our communities to provide good British jobs, skills and opportunities in every postcode". That sentence is the whole policy. Everything else in the document is mechanism.

It replaces the model in PPN 002, published in February 2025 and mandatory from 1 October 2025. That model scored bids against 5 government missions, 8 outcomes and 17 award criteria, backed by more than 30 standard reporting metrics. PPN 026 cuts this to 2 outcomes and 6 criteria and, for now, no metrics at all.

It is the third version of the model since 2020. PPN 06/20 introduced the first in September 2020 with five themes, including fighting climate change and wellbeing. PPN 002 reorganised it around the government's missions. PPN 026 narrows it to jobs and skills. The Cabinet Office press notice called the old rules a "tick box exercise" and put the market they govern at £90bn a year.

The PPN never names PPN 002. It refers to "the previous edition" and confines the transition rules to procurements commenced before 1 January 2027. Treat "replaces" as the practical effect rather than the legal wording.

Does PPN 026 apply to your organisation?

Four tests decide whether PPN 026 applies to a tender.

Decision flow showing the four tests for PPN 026: buyer type, tender notice date, contract value of £1m including VAT and the utilities and overseas exclusions, leading to the 10% and 20% bands

The buyer. Central government departments, their executive agencies and non-departmental public bodies. The PPN says other contracting authorities "may wish to adopt" it. It does not bind the NHS, local authorities, schools, housing associations or the devolved administrations, all of which run their own social value rules. The Ministry of Defence is a department, so it is in scope in principle. The PPN says nothing specific about defence.

The timing. Procurements commenced on or after 1 January 2027. A procurement commences when the tender notice is published. For procurements already under way on that date, buyers are "encouraged to transition" but can keep the old model where switching "would require disproportionate resources or invalidate previous market engagement activities". Expect PPN 002 and PPN 026 tenders side by side for most of 2027.

The value. £1m total contract value or more, including VAT, valued under section 4 and Schedule 3 of the Procurement Act. That is the maximum the buyer can pay, so options to extend, options for additional volume and the full value of a framework all count. A three-year contract at £350,000 a year with a two-year extension option is a £1.75m contract.

The exclusions. Private utilities contracts and contracts whose primary purpose is overseas delivery, such as embassies. Those are the only two the PPN states. Contracts under £1m fall outside it, though the Public Services (Social Value) Act 2012 "consider" duty still applies to services.

Frameworks are in. Buyers should assess social value at both framework and call-off. The footnote matters more than the paragraph. Under section 46(8) of the Act a call-off can only be assessed against criteria used to award the framework, so social value that was never scored at framework level cannot be scored at call-off. Frameworks let under PPN 002 in 2025 and 2026 will still be running in 2027 with PPN 002 criteria baked in.

Key PPN 026 dates

Date	What happens
5 August 2026	PPN 026 published
Autumn 2026	Guidance, sub-criteria, evaluation method, metrics and the "Resource for bidders: List of Community Programmes"
1 January 2027	Applies to procurements whose tender notice is published on or after this date
2028	First annual social value KPI ratings appear on the central digital platform for £5m+ contracts let in 2027

The PPN 026 model - two outcomes, six award criteria

Annex A is the model. It has two outcomes, each with three Model Award Criteria. Buyers score every criterion on what the supplier will do through delivery of the contract.

Six cards setting out Model Award Criteria 1a to 2c under the Good Jobs and Skills outcomes, with the actions that earn points

Outcome 1, Good Jobs. 1a rewards creating or retaining jobs in the relevant area, adapting recruitment so local communities can access them and creating jobs in high-growth sectors. 1b rewards working conditions beyond the statutory minimum and support for people who face barriers to staying in work. The PPN names trade union access, flexible working and a healthy workforce as examples. 1c rewards pay that goes "further than the statutory national minimum wage" and "progressive remuneration policies" that retain staff.

Outcome 2, Skills. 2a rewards training that addresses known skills shortages, co-designed with the community or cohort it serves, with apprenticeships, work placements and workplace adaptations as the named examples. 2b rewards in-work progression for the contract workforce and evidence that it improves retention and service quality. 2c rewards a talent pipeline built with communities in areas of multiple deprivation. It contains the most specific line in the document. "45 days of work experience is exactly the kind of social value the Prime Minister is seeking to see delivered through this policy."

Three things sit around the criteria.

Target cohorts. People not in employment, education or training, those moving from education into work, people with a long-term health condition or disability and care leavers. More will follow in the guidance.

Target skills. Drawn from government skills strategies. The one example given is "skills for clean energy jobs", which is the only place the environment survives in the model.

The List of Community Programmes. A government-curated list to be published with the guidance. Buyers will attach relevant programmes to tender documents. Where a bidder commits to one, the KPI monitors delivery of that programme. Buyers will evaluate bids separately on community programme and non-community programme outcomes. We expect this list to shape bid content more than the criteria themselves.

The guidance will also cover "existing, inherent social value", with the example of "the wider community benefits of retaining local jobs". That is a significant shift from the additionality principle in PPN 06/20 and PPN 002. It favours incumbents. How far it goes is the biggest open question in the document.

How PPN 026 weights and scores bids

The minimums are 10% of the total score for contracts from £1m to under £5m and 20% for £5m and above. Buyers can go higher. Where the evaluation uses an absolute methodology such as Price per Quality Point or a value-for-money index, the percentage applies to the non-price criteria, so social value is 10% or 20% of the quality score rather than of the whole.

The PPN does not say whether buyers will score responses qualitatively, as method statements, or quantitatively, as committed numbers. PPN 06/20 required qualitative evaluation. PPN 002 mixed both through its standard reporting metrics. PPN 026 leaves the "relevant evaluation methodology" to the guidance. Until it lands, prepare for both. Write the narrative and have the numbers behind it.

Two legal guardrails stay in place. Award criteria must relate to the subject-matter of the contract and be proportionate under section 23 of the Act. Buyers cannot discriminate against treaty-state suppliers under section 90. That second rule is how "good British jobs" is squared with the UK's trade agreements. The criteria score what happens in the communities where the contract is delivered, not where the bidder is headquartered. An EU or Canadian supplier scores full marks by committing to the same jobs and training in the same places. A criterion that scored UK ownership would be unlawful.

After a PPN 026 award - KPIs and the exclusion risk

On contracts of £5m or more the buyer should set at least one social value KPI. That is in addition to the three or more KPIs already required by section 52 of the Act. The buyer publishes all KPIs on the central digital platform and reports performance against them at least once every 12 months through a contract performance notice, rated Good, Approaching target, Requires improvement, Inadequate or Other.

Your social value commitments therefore become public, dated and rated. Anyone, including your competitors and your next buyer, can read them on Find a Tender.

The PPN adds that "evidence of poor performance against social value KPIs can be taken into account in considering whether there are grounds to exclude suppliers from bidding for future tenders". Read that precisely. A poor rating in an annual notice is not itself an exclusion ground. The discretionary ground in Schedule 7 of the Act needs a breach that was sufficiently serious, or performance the buyer was dissatisfied with after giving you a proper opportunity to improve. Where that leads to a breach notice, the ground applies for five years. So the route from a missed apprenticeship target to exclusion exists, but it runs through the contract rather than the scorecard. Commit to numbers you can hit.

What changed from PPN 002 and where climate went

Side-by-side table comparing PPN 002 and PPN 026 on scope, weighting, structure, themes, metrics, KPIs, consequences and dates

Climate did not move into PPN 026 and it did not disappear. Carbon Reduction Plans were never part of the scored social value weighting. They are a condition of participation under PPN 006, which still requires a board-signed plan, updated at least annually and published on your UK website, for contracts above £5m a year. PPN 016 adds an optional contract schedule with in-contract emissions reporting and a default 10% annual reduction target. Neither PPN references PPN 026 and neither has changed.

What has gone is the ability to score environmental commitments as social value. The old "fighting climate change" theme and its successor "sustainable procurement practices" outcome have no equivalent. A buyer can still score environmental quality criteria where they relate to the subject-matter of the contract. The Cabinet Office guidance on assessing tenders names carbon reduction as a permissible factor. The buyer now has to justify it contract by contract rather than draw it from the model.

Wellbeing, equal opportunity, supply chain resilience, modern slavery and the criminal justice outcome have no successor either. Disability survives only as a target cohort. Social value practitioners have been blunt about it. Darren Knowd, on Social Value Portal's expert panel, called it "a policy about employment and skills". Sarah Stone of Samtaler said that without clarification on the environment "it could set us back years".

Outside central government nothing changes. The NHS keeps its 10% minimum weighting on net zero and social value and brings in its 2027 Carbon Reduction Plan standard on 1 April 2027, which sits alongside PPN 026 in our rundown of UK ESG reporting deadlines for 2026 and 2027. Councils keep the Social Value Act duty and the TOMs frameworks. Wales and Scotland run their own statutory regimes.

How to prepare for PPN 026 before 1 January 2027

Bid teams have until 1 January 2027 before the model goes live, with the guidance still to come. Five things are worth doing now.

Map your evidence to the six criteria. Pull the HR, payroll, training and apprenticeship data you already hold and sort it under 1a to 2c. Most bid libraries are organised around PPN 002 themes. Relabelling is not enough, because supply chain, environment and wellbeing content has nowhere to go.
Decide your pay position. 1c scores pay above the statutory minimum and progressive remuneration. That is a finance decision with a cost across the whole contract workforce, not a bid-writing decision. Get the CFO in the room before the first tender.
Build the local evidence base. 2a and 2c reward co-design with communities in areas of multiple deprivation. Know the indices of deprivation and the skills shortages for the places your contracts are delivered and build relationships with the colleges and anchor institutions there.
Design KPIs you can publish. Every £5m+ commitment will be rated in public once a year. Set numbers your delivery team has signed off, with an owner and a data source, before they go in a bid.
Check your live frameworks. List the frameworks you sit on that run past 1 January 2027 and the social value criteria they were let against. That decides what can be scored at call-off.

Consultants advising bidders should add a sixth. Read the autumn 2026 guidance before committing clients to positions on inherent social value, sub-criteria or metrics. Everything in this article that is not in the PPN itself will move.

Our ESG consulting team helps suppliers turn workforce, skills and carbon commitments into bids that score and contracts that deliver. If PPN 026 is in your pipeline, speak to a consultant.